This purpose of this project is to examine how "economic globalization" affects domestic economy and market and changes in domestic economy and market restrain state policy choices by reviewing international balance of payment adjustment policy. In the fiscal year of 1997, the research was conducted in two points ; reviewing arguments on political aspects of economic globalization and internationalization and doing research on the case of Japan's balance of payment adjustment policy in the 1990s. As a result of theoretical review, I confirm that the relation between state autonomy and economic globalization requires more clarification. As for the case of the 1990s, there was less domestic preferences against the high yen unlike the case of the 1970s and 80s, despite similar international pressures (especially US pressures) on Japanese government to apply expansionary fiscal policy as the 1970s and 1980s.In the fiscal year of 1998, the theoretical review of the relation between increasing capital mobility and state economic policy choice was done and the research on the case of Japan's adjustment policy in the 1990s was continued. These research assumed that changes in societal preferences toward the exchange rate was related to the passive attitude of Japanese government toward expansionary fiscal policy in the 1990s.